test caption >> the roller coaster week just about where it began. >> this is not a normal period. this is abnormal volatility. >> so will the wild market swings continue? some answers coming up. it's "nightly business report" for thursday, august 11. this is "nightly business report" with susie gharib and tom hudson. "ghtly business report" is made possible by:

this program is made possible by contributions to your pbs station from viewers like you. thank you. captioning sponsored by wpbt >> susie: good evening, everyone. my colleague tom hudson is off tonight. it was up, up, and away here on wall street today. >> it was in stark contrast after alternating days of ferocious losses and gains. the focus of today's trading-- conflicting reports on the health of the u.s. economy. an encouraging report from the commerce department showed retail sales rose more than expected, up half a percentage, in july. it was the biggest one-month increase since spring as consumers spent more on gasoline and electronics. but the latest survey on

consumer sentiment revealed how pessimistic american consumers are feeling about the future. the university of michigan index showed accept theiment dipped in august to its lowest . in 30 years. now here's how things looked by the closing bell. the dow add 125 points, the nasdaq knand 15, the s & p 500 notched up six. the pace of trading settled to a more normal range with 1 billion shares trading here on the big board, two billion on the nasdaq. the major averages almost finished positive for the week but were down slightly when you add up all the numbers. the dow, for example, down 175 points or 1.5%, the nasdaq off 24 points, or 1%, and the s & p 500 one of the hardest hit off almost 2%. so will this intense volatility return next week? and what's behind the massive swings? erica miller reports. >> weeks like this one are

extreme, but for the rest of us, the market's wild swings are confusing and often distressing. that even goes for veteran stock strategist bill cow. >> this is not a normal period. this is abnormal volatility. i had dinner with retail clients last night, and some of the retired people were wondering whether they'd ever come back to the stock market again. >> reporter: two trillion dollars in stock market wealth has vaporized this month and august is on track to be the worst month for stocks since the financial crisis. the big moves in the market this week are being blamed on a tug-of-war between two views of the economy-- one camp believes the recovery is slowly gaining traction. >> it's moderate growth, subdued growth from what most economists are expecting, but not a recession. against that backdrop, corporate earnings are pretty good, ref news pretty good, three quarteres of revenues better than expectation. >> reporter: the other camp is worried the u.s. is headed for a double dip, possibly sparked by

awe european trading crisis. computer trading by brokerage firms appears to be affecting the moves in both directions. >> once something is under way, a stock starts to weaken and break below a key level, then the computer presses on that. it tries to profit from prospective momentum, further weakness, and so it becomes somewhat of a self-fulfilling prophecy. >> reporter: many wall street pros think market volatility will continue until there are clear signs about the direction of the economy. in addition, investors want reassurance that european banking problems are well contained. about the only good news is that many wall street pros think the worst is over for stocks. but some warn the market's d.n.a. has been badly damaged this week. >> anyone who bought securities of any kind, any stock, five days ago or prior, all the way back to january, is under water. they're trapped. anything they bought, is back

bodily against them. they bought it at 10. now it's eight. they bought it at 55, now it's 45. >> reporter: he shalls anxious investors will sell happy to break even. as a result, he believes the stock market will end the year basically flat. erica miller, nightly business report, new york. >> susie: how to fix the economy was the hot topic at the white house today. president obama called on top business leaders for their advice. the c.e.o.s of johnson & johnson, u.s. steel, and xerox were there. as well as the heads of american express, blackrock, wells fargo and u.s. bancorp. the c.e.o.'s spent more than an hour in the roosevelt room with the presdient. reportedly, their ideas will be incorporated in a proposal the white house is working on to create jobs. >> more gloomy economic news from europe. france's economy ground to a halt in the second quarter. itsiose domestic product fell to zero in the april-june period as

consumer spending there plunged. still the, the french government is sticking by its prediction for 2% growth on the year. now on tuesday, french president nicholas sarkozy meets in paris with german chancelerangula merkel. the two leaders are expected to discuss how to make the euro zone work more effectively. meanwhile, italy's cabinet has approved an austerity program. it's estimate estimated to be worth about $64 billion. the measures include a solidarity tax on high earnings and deep cuts in local governments.

a u.s. appeals court ruled against the mandate requiring all americans to buy health insurance. it's the obama administration's biggest legal defeat so far. darren governorsh takes a closer look at what's at stake in this court battle. >> a cornerstone of the health >> reporter: a cornerstone of atthe irquveement that everyonen the country have health insurance. but the 11th circuit court in atlanta ruled forcing some individuals to buy coverage is unconstitutional. in its opinion the court says congress could not force people to buy "an expensive product from the time they are born until the time they die." critics of the law like the heritage foundation's brian walsh say the court was right to reign in the federal government. >> the federal government's been given specific power over interstate commerce. making a decision not to buy health insurance is not interstate commerce. that's stretching the bounds, that's stretching the conceptualization of what interstate commerce is beyond all recognition. >> reporter: but the circuit court left the rest of the

health care reform law intact, and that could be a huge problem for health insurance providers. beginning in 2014 they will no longer be allowed to deny coverage based on pre-existing conditions. but if individuals don't have to buy a policy, they may wait until after they get sick to shop for insurance. and companies would still have to sell them a policy. >> it becomes a real problem because you essentially have all the stick and no carrot. this means you won't get nearly the number of new enrollees that you thought you would. >> reporter: another apelate court in cincinnati has upheld the individual mandate. the court in atlanta has ruled it unconstitutional. that makes it likely the supreme court will decided who is right. >> now we have two circuit courts essentially with opposing rulings and that's always fodder for the supreme court. >> reporter: the justice department argues the affordable care act does regulate interstate commerce. a top white house health care adviser said today individuals who go without health insurance are making an economic decision

that affects taxpayers who are often left to pick up the tab. darren gersh, nightly business report. >> susie: investors are also watching what's happening in jefferson county, alabama. county leader leaders there are deciding whether they need to file what would be the largest government bankruptcy in u.s. history. today, those leaders rejected a settlement to pay off the county's $3 billion debt. the area, home to birmingham, alabama's largest city, has been trying to avoid bankruptcy for three years as it struggles under $3 billion in debt tied to sewer bonds. county commissioner james stephens is optimistic an agreement with creditors can be reached. >> we're going to make every effort to resolve this crisis and do so to the benefit of the citizenses of jefferson county. >> susie: the commission now has until september 16 to negotiate a deal with its creditors, including j.p. morgan chase. it was certainly a historic week here on wall street with one of the most volatile streaks in

history of the u.s. stock market. the one question everyone was asking today-- is it over yet? let's take a closer look at the stocks making news in tonight's market focus. stocks were higher from the open, and stayed that way all day, even with some selling in ene final hour of trading. here's an intraday look at the dow. it traded in a narrow 200 point range, and posted its first two- day rally since early last month. today investors went bargain hunting and found some good deals in beaten down industrial stocks. among the standouts: honeywell international and boeing, both up 5%. united technologies adding 4%. dow component hewlett-packard was one of the stars of the day. shares rose more than 4% or up $1.27. coming into today's session, h.p. was down nearly 30 percent

on the year. but jefferies says the stock's multiple is just too low to ignore, and boosted h.p. to a "buy". also helping h.p., the company cut the price on its touchpad tablet computer by 100-dollars yesterday, so it can better compete with apple's i-pad. another rough day for financials. all of the big names were down. morgan stanley hit the hardest, off over 7%. jp morgan down 2% wells fargo, citi and bank of america also seeing selling. but given all the carnage in financials this week, you might be surprised to see bank of america was not the weakest over the past five sessions. that honor goes to morgan stanley, down 15% on the week. bank of america off 12% this week. earlier we mentioned the modest gain in july retail sales. some mixed earnings in that sector today. nordstrom rose almost 5%high end shoppers still buying. the upscale retailers latest

results beat the street, and nordstrom boosted its outlook. but more traditional department stores are struggling. dillards and j.c. penney were both down after reporting decent earnings, but had cautious outlooks on concerns about nervous consumers. ---(susie w/ots) and finally, devry the biggest loser in the s&p 500. a troubling sign as we head into the "back to school" season. the stock down almost 17%. despite posting better than expected quarterly earnings last night. investors spooked by a 26% drop in new undergraduate enrollments. and that's tonight's market focus.

>> susie: in this tumultuous week, there is a ray of hope for a disdecimated industry. hundreds of thousands of construction workers who have been sidelined by the weak housing market might want to head out to the heartland. there's a building boom going on there in agriculture. as diane estabrook reports, farmers are producing so much grain they're running out of places to store it. >> reporter: high above fertile farmland in central illinois, a huge steel cap flies through the air with help interest a crane operator. on top of a new grain elevator, workers position it li crown. kale brothers incorporated built this new corn dryer and storage

bin for stony ton cooperative grain so they can move in more grain. the president says this $2 million project isn't unusual these days. >> we have seven projects going at this time. we have 17 out on a job site, and we have seven-- seven or eight projects for this fall that we're scheduled to do. >> reporter: is that unusual? >> for the fall, yes. >> reporter: thanks to global demand for grain and genetically modified feed, farmers are producing bumper crops and getting richer. with farm incomes expected to increase 20% this year over last, producers can better afford projects like this. don'tingstop co-op manager kevin walker says farmers are also keeping up with the times. the co-op's original facility is 50 years old. >> that's the name of the game. if you want to stay in the business, you got to get up where the faster the producer is. that's why we're-- why we're adding on here. >> reporter: there are seven kale brother employees on this job today, but over the past

four months, there have been about 40 outside workers involved in this project. that means everybody from concrete pourers to traditions. with business so brisk, kale brothers has been on a hiring spree, something unusual for an industry that sheds thousands of jobs in the last few years. >> since march of this spring, we've added six new workers and since last september, we've added 10 new employees. so our employ count has almost grown by 25%. >> caper thinks construction of new storage wins could taper off in a few years but only if demand for grain becomes so robust, farmers must ship it as soon as they harvest it. diane estabrook, nightly business report, stonington, illinois. >> susie: here's what we're watching for you for next week. our friday market monitor is marshall front, chairman of front barnett associates. also next week, the july reports on existing home sales, and a check on consumer and producer prices. on monday, we kick off a weeklong series looking at ways

to fix the economy. our focus: solutions for europe debt crisis, the u.s. housing market, and businesses both big and small. federal investigators say mortgage fraud is still widespread, despite modest improvements in the economy. an f.b.i. report released today says schemes are prevalent and often difficult to discover. the scams range from short sale fraud, illegal flipping of houses, and outright house stealing. perpetrators range from members of the mortgage industry to organized crime groups from overseas. a former managing director of the nasdaq exchange was sentenced today to three-and-a- half years in jail for insider trading. donald l. johnson had pleaded guilty to charges of insider trading back in may. johnson bought and sold shares of five nasdaq-listed companies based on inside information between 2006 and 2009. he often made the trades from his work computer. johnson expressed remorse for

his actions, and said what he did was quote "stupid." >> susie: our market monitor guest tonight says the turmoil and volatility in the markets could continue for the rest of the year. but he thinks there are still ways investors can protect and grow their portfolios. joining us: jason pride, director of investment strategy

at glenmede. hi, jason. and welcome to nightly business report for the first time. >> hi, susie. it's great to be on. >> susie: well, let's-- you know, what a crazy week this was. what do you think is going to happen next week? >> next week our guess is there's going to be continued instability within the marketplace, and, basically, you haven't fixedly the euro crisis and whose going on with the banks there, there's going to be continued worries along those lines and that's likely the biggest deterrent. >> susie: >> announcer: this has been a scary week for a lot of individual investors. what are you telling investors to do and not to do during this turmoil? >> so this is-- this is very difficult for people because equity valuations are really low, so you want to be putting more money into equities, generally speaking and fixed income valuationsa horrible. so you have a difficult

situation here this trying to protect. if you protect you're really giving up long-term returns. so what we're doing is we have been searching for investments that have the ability to generate long-term returns, that are respectable, but also provide some protection. and, you know, if we walk through those investments there's a lot of different ways to do this. what it is, is you're not going all the way out on the equity spectrum. you're not going all the way out on the fixed income spectrum. you're staying somewhere in the middle and that falls in the case of high-quality stocks like a phillip morris. >> susie: let's go into them. let's go down your list because there's a theme to the suggestion that you have for tonight. let's start with phillip morris international. this is the cigarette company that cells overseas, and its ticker symbol, not to be confused with altria, is p.m. tell us about it. >> this is basically a stable growth sort of play. it's a company that can generate long-term returns, less economically exposed because of focus in the cigarette market,

which is relatively stable revenueienerator. they have growth prospects because they're exposed internally, particularly in the emerging market place. and you add to that a 4% dividend yield and protects you and provides return at the same time. >> susie: how about y.u.m.? is it the same story? >> a similar story. not as stable of a company but you have the you should'd underlying theme of connection to the emerging market, growing consumer base. they have a very large emerging market focus with incomes rise 15% to 20% over there, that's a good thing, and interestingly, overseas, especially in the emerging markets, basically their k.f.c.s, are considered to be relatively decent restaurants as opposed to the ones in the u.s. that don't really have quite the same attraction of luxury. >> susie: going down your list, you have an e.t.f. play on japan, wisdom trees, japan's

total dividend fund, symbol d.x.j. why japan? >> basically, the bottom line here is valuation and exposure to the emerging market consumer yet again. and in order to get that stability. you've got a double combination of those two things, valuations create bide the earthquakes we have been through and the fact that japan has performed horribly as a stock market for 15-20 years. valuations are now good. >> susie: all right, and your favorite for investors-- this is what you were telling me the other day-- a mutual fund, templeton global bond fund. why is this your favorite? why do you think investors should own this? >> this is an interesting, alternative way to get returns in this environment. this is an investment that is heavily focused in the emerging market debt area. you've got 7% to 8%ioles in that area which will rival equity market returns, longer term, and provides an interesting

stability because you're investing in debt first of all, and second of all, you're investing in debt of countries that arguably have better balance sheets and better fiscal management at this . in time than the developed markets li the u.s. and europe and even jap have. >> susie: all right, all very interesting. jason, do you have any disclosures to make? do you own any of these stocks? >> i don't own any of these personally. my family doesn't own any of these personally, basically due to prohibitive rules surrounding what we can invest in, but our clients do. >> susie: listen, it was great having you on the program. we hope to have you back soon. thank you so much. >> thank you. >> susie: we've been talking with jason pride, director of investment strategy at glenmede. just a reminder: you catch us online at nbronpbs.org. you can comment on our blog or watch any programs that you may have missed. or you can follow us on twitter and facebook. our handle on both is b-i-z r-p- t. my personal feed: sgharibnbr. and finally: the price of sushi

as an economic indicator. bloomberg examined the raw data to come up with the "sushi- nomics" cost of living index. it basically rolls together a city's cost of living with the price of a california roll and a spicy tuna roll. the results: los angeles topped the chart as the place with the most expensive sushi, followed by new york and san francisco. minneapolis and austin, texas, rounded out the top five. that's "nightly business report" for friday, august 12. we want to remind you this is the time of year your public television station seeks your support, support that makes programs like "nightly business report" possible. thanks for joining us. have a great weekend. i'm susie gharib. we hope to see all of you again next week. "nightly business report" is made possible by:

this program was made possible by contributions to your pbs station from viewers like you. thank you. captioning sponsored by wpbt captioned by media access group at wgbh access.wgbh.org